Oklahoma’s Largest Utility Prepares To Comply With EPA, Pass Costs To Customers

Oklahoma Gas and Electric has put up staunch resistance to new federally mandated air pollution rules, joining Oklahoma Attorney General Scott Pruitt in taking the U.S. Environmental Protection Agency to court over the regional haze and mercury and air toxics rules.

OG&E was ultimately unsuccessful in those challenges, and now, the time to start complying with the regulations has come. And as the utility has been warning for years, complying with new EPA rules will mean higher electricity bills for customers.

As The Oklahoman’s Paul Monies reports, on August 6, Oklahoma Gas and Electric Co. “filed an application to recover $1.1 billion from ratepayers to pay for environmental compliance and the replacement of its aging Mustang natural gas plant.”

If granted by regulators, the costs could increase the typical residential customer bill 15 percent by 2019. The utility wants permission from the Oklahoma Corporation Commission to begin collecting the charges in 2015. More than half of the $1.1 billion would go toward environmental upgrades to meet emissions standards under the federal regional haze rule and the mercury and air toxics rule.

According to a press release from OG&E last week, the utility will comply with the regulations by installing two air scrubbers onto existing coal-fired units at its Sooner Power Plant, and converting two coal-fired units at its Muskogee plant to natural gas.

The rest of the money will be used to upgrade OG&E’s Mustang Power Plant, which already runs on natural gas, but uses steam turbines from the 1940s that take 10 hours to power up. The utility says the new combustion turbines can start in 10 minutes and will “maximize the benefits of renewable energy.”

“OG&E’s plan for complying with environmental protections lacks real commitments to proven, low-cost, renewable energy like homegrown Oklahoma wind that could help lower electric bills, and instead invests hundreds of millions of customer dollars into an aging coal plant to keep it running for 30 more years,” said Whitney Pearson with the Sierra Club’s Beyond Coal campaign.

OG&E representatives said the utility aggressively added wind in the last decade and now has 841 megawatts of wind capacity. It wants to wait until more transmission lines are built in the region before adding wind generation.

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